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U.S. tariff threat hits European automakers' stocks

FRANKFURT, Germany — A U.S. warning that it may introduce tariffs on foreign auto imports hit shares in German carmakers BMW, Daimler and Volkswagen on Thursday, which together have a more than 90 percent share of North America's premium car market. Washington said on Wednesday it had launched an investigation into whether car and truck imports are a national security issue due to signs they had damaged the U.S. auto industry. That could lead to new U.S. tariffs — up to 25 percent — similar to those imposed on imported steel and aluminum in March. BMW and Daimler shares fell as much as 3.1 percent in early Thursday trading, while Volkswagen's dropped as much as 2.5 percent. "(U.S. President) Donald Trump is obviously not thinking about how to prevent a trade war. Import duties on cars would be a nightmare for the German auto industry and would lead to a massive sales impact," said Thomas Altmann at Frankfurt-based asset manager QC Partners. BMW on Thursday condemned the move to consider tariffs. "The BMW Group is committed to free trade worldwide. Barrier-free access to markets is therefore a key factor not only for our business model, but also for growth welfare and employment throughout the global economy," it said. Daimler, which makes Mercedes-Benz cars, and Volkswagen, which makes upmarket Audis and Porsches, were not immediately available for comment. German carmakers produced 804,000 cars at local factories in the United States and exported 657,000 German-made cars into North America last year, according to German auto industry association VDA. China took pains on Thursday to welcome German firms and investments, with Premier Li Keqiang talking up relations after a meeting with German Chancellor Angela Merkel. BMW and Mercedes have expanded production capacity in the United States, but BMW, Audi, Volkswagen and Daimler have also invested billions to build new factories in Mexico in the hope of selling locally produced cars into the United States. German carmakers hiked vehicle production in Mexico by 46 percent to 620,000 cars last year, while production levels inside the United States fell by 6 percent to 804,000 cars because of a shift to Mexico, according to the VDA. BMW has its biggest factory worldwide in Spartanburg, South Carolina, and is the largest vehicle exporter among all the carmakers in the United States measured by value of goods exported. More than 70 percent of BMW's U.S.-made cars are exported.

Audi TT RS shows its meaner face in new spy shots

When it launched, the original Audi TT RS was considered quite a sharp combination, melding a 360-horsepower turbocharged engine and all-wheel drive into a rather lithe, little coupe. Audi is ready to revive that great idea and is preparing for a return on the automaker's latest platform. Thanks to these new spy shots from near the Nurburgring, we can at least get a good idea aesthetically of what's in store for this future member of the RS family. There's absolutely nothing subtle about the front end, and the camouflage does little to hide the larger intakes at each corner. In profile, you can also spot larger brake discs peeking out from behind the wheels, and the side sills appear slightly thicker than the current TTS. The rear is all business, as well, with a lower apron and two big oval exhausts. The new TT RS reportedly arrives in 2016, at least in Europe, and a debut is possible at the Geneva Motor Show in March. The coupe would then potentially come to the US later in the calendar for the 2017 model year. Unlike the last TT here, which got a manual transmission, rumors suggest that the latest one would only offer a seven-speed dual-clutch gearbox. There's not likely to be any disappointment about the power, though, because it supposedly grows to about 400 hp thanks to an upgraded 2.5-liter turbocharged five-cylinder. Related Video:

Audi RS Q3 Performance pours sugar on the forbidden fruit

Don't let anybody tell you that Europeans don't like powerful SUVs any less than Americans do. They just like theirs a bit smaller. Case in point: the new Audi RS Q3 Performance. The latest in the ne plus ultra from Quattro GmbH joins the RS6 Avant Performance and RS7 Sportback Performance in dialing up the power even further. So while the 2.5-liter turbocharged inline-five carries over from the existing RS Q3, its output swells to 367 horsepower (27 more than before) and 343 pound-feet of torque. As a result, this tall take on the hot hatch blasts to 62 in just 4.4 seconds before topping out on the open Autobahn at nearly 168 miles per hour. Along with the power boost, the RS Q3 Performance benefits from a retuned seven-speed dual-clutch transmission, which works in tandem with the hydraulically actuated, electronically controlled all-wheel-drive system to get the power down to the road. The suspension is lowered, with available adaptive dampers fitted to 20-inch alloys. There are subtle details inside and out to distinguish it from "lesser" RS Q3 models. Unfortunately while Audi does offer the Q3 in base form here in America, it doesn't offer the RS variant altogether, let alone this new enhanced version. In fact the RS7 is the only model in the line we get here, so we'll just add this one to our growing list of forbidden fruit that we'd like to taste. Our compatriots in Germany, however, can pick one up right away for 61,000 euros, before it even makes its debut at the Geneva Motor Show next month. Related Video: 02/04/16 | Ingolstadt Pure power: the Audi RS Q3 performance - New top model with more power and exclusive equipment - Award-winning five-cylinder with 270 kW (367 hp) - Now accepting orders for the Audi RS Q3 performance Audi ignites the next stage of performance in the compact, high-performance SUV segment: The Audi RS Q3 performance* impresses with an output of 270 kW (367 hp) and 465 Nm (343.0 lb ft) of torque. This incredible power catapults the new top-of-the-line model from 0 to 100 km/h (62.1 mph) in just 4.4 seconds. Standard top speed is 270 km/h (167.8 mph). The premium brand is honing its sporty profile with new RS performance models. The "performance" in the name stands for both a significant power boost and exclusive equipment that clearly elevates the respective model above the rest of the portfolio. This also applies to the new RS Q3 performance, whose pulse is driven by the legendary Audi five-cylinder engine.